I don't think there can be a solution until the radical fanatic nutcases accept that they will never destroy Israel, and have to make peace with Israel.

Once they do that, and actually want peace with Israel, Israel will be able to do it, just like Israel made peace with Egypt when Egypt wanted it, just like Israel made peace with Jordan when Jordan wanted it.

First of all I think Israel is right to destroy all Hamas's rocket launching capabilities and I think their current operation is painful but necessary. That said, Hamas is popular for a reason. The argument about the Palestinians never wanting peace is to some degree self-prophecy.

There is, though certainly not angels themselves, somewhat of a willing partner in the West Bank, who keeps getting emasculated by Likud. Abbas has kept the West Bank relatively calm through a couple flareups, but there is absolutely nothing to show the Palestinian people for it. "They should stop fighting rockets first," while true, is in effect what has happened in the West Bank and during that time the settlers continue to sprawl, all Abbas has to show for moderation is advancing Israeli settlements.

Israel has to consider Gaza and West Bank completely separate. Even if Abbas gives rhetoric about unified Palestine (he has to because his overtures to Israel that don't result in anything make him very weak), make it very very clear they are willing to make deals on issues regarding the West Bank. Be VERY generous to the West Bank as long as they aren't firing rockets FROM THE WEST BANK. That means stop the flow of settlers and remove the blatantly illegal ones. Try to do whatever you can to develop them economically through their government. The key is to show that not firing rockets will actually give you something. This will make the more moderate Palestinians popular. Right now they just look like sellouts to their people. Imagine you're a Gazan who feels extremely wronged, and you see the West Bank and Fatah stopping armed resistance just encourages Israeli settlers to expand. Obviously launching rockets is not rational for the Palestinians but if Israel won't stand up to the land grabbers and show peace is worth it, it encourage irrationality.